This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Priceline Tries to Negotiate an Earnings Beat

NEW YORK ( TheStreet) -- The economic downturn has hit companies far and wide, but perhaps none more so than (PCLN - Get Report).

The Norwalk, CT.-based online travel company generates a significant portion of its revenue from Europe, which could not only affect earnings, but third-quarter guidance as well, says Piper Jaffray analyst Michael Olsen.

Olsen is expecting priceline to report upside to earnings for the second quarter, but expects conservative domestic and international bookings guidance for the third quarter. "Additionally, Q3 EPS guidance will likely be below consensus (Street currently at $12.95) due to the rapid depreciation in the USD:EUR FX during July, but we expect investors will focus on FX neutral bookings growth," Olsen wrote in his report. He rates priceline "overweight" with a $811 price target.

Analysts surveyed by Thomson Reuters expect priceline to earn $7.36 per share on $1.35 billion in revenue for the second quarter.

Even with troubles in Europe, though, priceline is expected to show strong growth, thanks to the boom in online travel and consumers being more cost-conscious than ever. That sentiment has shown up in the company's shares, which have gained 44.3% year-to-date, far outpacing the 15.33% return in the Nasdaq, as well as the S&P 500.

PCLN Chart PCLN data by YCharts

"We expect strong 2Q results given favorable travel industry dynamics and solid performance by Expedia and hotels overall," wrote JPMorgan analyst Doug Anmuth in a research report. "We expect Priceline to be the biggest beneficiary of stable/rising ADRs in Europe, despite ongoing macro concerns in the region." Anmuth lists priceline as one of his two top Internet stocks for 2012, based on's continued gains in Europe. (AMZN - Get Report) is the other top Internet stock. He rates priceline "overweight" with a $770 price target.

Anmuth also cited strong second-quarter results from Expedia (EXPE - Get Report) as reason for his optimism. "Marriott, Starwood, and Hyatt reported solid global RevPAR [revenue per available room] growth driven by strength in N.America and Asia, with solid travel trends in Europe," he noted. "Hotel guidance for 2H12 generally remained stable, with expectations for a positive lift from the London Olympics in 3Q, though it's less clear that Priceline will benefit materially from the event."

Interested in more on Priceline? See TheStreet Ratings' report card for this stock.

Check out our new tech blog, Tech Trends. Follow TheStreet Tech on your wireless devices.

-- Written by Chris Ciaccia in New York

>Contact by Email.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AMZN $678.05 2.00%
EXPE $124.62 1.20%
PCLN $1,275.65 2.10%
AAPL $117.48 -0.69%
FB $106.17 1.90%


Chart of I:DJI
DOW 17,821.38 +101.46 0.57%
S&P 500 2,091.28 +10.87 0.52%
NASDAQ 5,130.8320 +22.1660 0.43%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs